Monday, 26 December 2011

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Saturday, 24 December 2011

If you read this book as a novel, the plot is too simple - a group of friends (members of a non-political, non-violence ecologically focused group called One Planet) were contacted by "External Consciousness". In order to protect the information these people got, the USA secret service killed them all.

The "meat" of the book is the five chapters presented as the interviews with External Consciousness by these members of One Planet. If read as fiction, it is dry. Basically, it is External Consciousness explaining how a higher intelligence has designed the "biomatrix" - the biological system on Earth, the developments and so on. If read as science, well it is non science! The first interview is about the creation. Poised as a description of how Universe has evolved and how life on earth has evolved, the chapter is full of voodoo promoted by people such as Deepak Chopra.

I would not recommend reading this as fact or science. I would not recommend reading as novel too.

Thursday, 22 December 2011

Economy develops, first by imitation. R&D is Repeat and Duplicate. Until one can do what others can do, there is no way to join the innovation bandwagon. Once one has mastered all the techniques, innovation can start.

After 30 years of importing technology, China is now poised to create her own. The story of high speed rail may shed a light of what is her strategy.

The Chinese high speed rail project started with co-operation with foreign high speed rail manufacturers in stages. At every stage, the foreign company was required to build the parts in China with an appointed factory. This same factory, after co-operation with 6 different foreign manufacturers, "digested" all the foreign technology and started to create her own intellectual properties. Now China is bidding to provide high speed rail to USA. While not the fastest, China has the largest high speed rail network. The only commercially operated Maglev is in Shanghai, China

Wednesday, 21 December 2011

It seems that Friedman is an author whom if you read one of his book, you have read all. In the review of The Next 100 Years: A Forecast for the 21st Century, I deposed that he has missed a number of key factors which will affect the next 100 years. In this book, I was expecting to read a proper analysis of the leading up to the current financial situation and what are the policy options for USA in the next decade. I am equally disappointed by his stubborn obsession of American domination as his book I last reviewed.

I disagree with his reasoning that the current financial situation in the America is part of a financial cycle. I agree with the view that it is the accumulation of no real wage growth while corporations reported soaring profits since 1980's. [ref] The middle class of USA has been collapsing. [ref] USA Government debt is about 100% GDP, almost as high as the one during the second world war [ref] The American's industrial base has almost completely off-shored to China. As I have noted in my last review, the intellectual capital of USA is also declining.

IMF predicts that China economy will overtake USA by 2016 which is within the scope of this book and Friedman just seemed unaware of this and continued to paddle that China will collapse due to internal conflict. [ref] Is that selective data gathering?

Politically, USA is corrupted. Bribery is legalized as lobbying. Friedman's notion that USA is an empire is ironically head-on. The government is working for a few privileged. The current style of western democracy has only been around for a few hundred years. When political leaders are elected based on popularity rather than demonstrated ability to govern and decision-making, one would wonder if the political system evangelized by USA is reaching its limits.

The next decade is an important decade for humanity. There are difficult decisions to be made, especially for the environment and climate - which is very much linked. Water, food, energy, climate, displacement of people are some of issues I was looking forward to.

Friedman did mention about water. He deposited that there are plenty, except not directly usable by human. The scarcity is fresh water and desalination is energy intensive and costly. Here are two possible projects USA government would have chosen to support. A few years ago, there was a project in Eritrea at which sea water was used to farm shrimps and fish. After that, the nutrient rich water is used to feed salt loving plants such as salicornia and then mangroves before returning to sea. Salicornia can by consumed by human, animals and/or converted into bio fuel. Unfortunately, the project was terminated by political reasons. If USA is to be a force for good, her political capital could have been used to save these projects. [ref] The other is seawater greenhouse as a possible solution for food and fresh water. [ref] While it is not too late to rescue the former project and provide support for the latter, if USA leaders, however, continue to think in line as described by Friedman, she could miss a golden opportunity and the world would be a little bit worse off.

Production of oil looks like have peaked in middle of the first decade of 21st century, a fact acknowledged by Friedman. If that is true, the price of oil will only go up. If USA economy can magically recovered in the next few years, the competition of oil from China and USA will drive the price to the roof, creating mayhem to a lot of people. Switching the transportation system to renewable energy source will need at least a decade. Switching baseline electricity load to renewable sources is also decades ahead. These infrastructures takes time to change. The geopolitical issue resulted from this is very dangerous if according to Freidman. Bumpy roads ahead, both for governments and people!

Food production is tightly linked to climate change. As the earth's average temperature is expected to continue to rise, extreme weather events will make food production unpredictable. Food price fluctuations would have significant political implications around the world - not only to USA.

If the consuming economy continues, one of the key resource in electronics and battery is rare earth elements. China has the largest reserve of them and produces almost 90% of all the rare earth elements in 2000. [ref] Again Friedman failed to see the importance of the control of these elements in a technological age and the implication to the USA economy.

When a country has been living out of her means for an extended time, when her political system is showing signs of weakness, when her economy is in trouble, when she is spending disproportionately in military rather than upgrading old and mal-functioning infrastructure, when intellectual capital is declining (comparatively), when health care cost is double that of the other nations' average without significant benefit, when a significant portion of the population is plagued by obesity, heart disease and/or diabetes, and a changing climate, declining energy source are in the near future, a world domination mentality would only led to a more dramatic decline. A policy based on military means to secure the scarce resources would only led to conflict. As there are many nations with nuclear capability, such a policy is very dangerous if not outright infeasible.

To be fair to Freidman, this book is about geopolitics and he was trying to look into a crystal ball. By missing several key factors, his future can only be wrong. He is also driving his predictions by a USA centric, dominating role overtune. For the sake of humanity, I hope there is no USA political leaders who will take his future as policy guides.

Tuesday, 20 December 2011

With the advantage of writing this review 10% into the 21st century, I can point out the important factors that Friedman has missed in this book.

Friedman does not show an understanding of the Chinese culture which is rising rapidly and hence has misjudged the implication of a powerful China. He is absolutely correct that China was more like an isolated island, with difficult to penetrate borders on all sides. That is no longer true in light of modern technology. In 1421, before Columbus set sail to 'discover' the world, Chinese fleet, led by ZhengHe has already visited Middle East and Eastern Africa. The size of the ocean going junks used by ZhengHe built over 60 years earlier towered over Columbus ships. [see http://www.youtube.com/watch?v=FI1AmTa-bV0] Until about 500 years ago, China was the world's leading economy and power.

China has been conquered by foreign powers twice in her entire history. First at Yuan Dynasty which lasted less that 100 years and the second time at Qing Dynasty [1644-1911 CE] - the last dynasty before the new China was born. The result is that the conquerors were melted into the Chinese culture and became Chinese.

The above two snippets of history tell a story which Friedman has completely missed.

1. Being geographically isolated in the past, China has to be self-sufficient in order to survive. China could not depend on conquering other people to steal wealth. For an agricultural society to remain viable, a stable society was a prerequisite. As such, Chinese is a peace loving culture. When she has the power to conquer the world, she chose not to do so.
2. Being self sufficient, it was tempting for the Emperors to close the border and focused mainly on internal affairs. Of course the closing of trade in the last 500 years proved to be disastrous for China. Chinese, thus, has learnt a lesson which is still painfully remembered. A country needs a sufficient strong defense in order to protect herself. That's the main motivation why Mao insisted on China becoming a nuclear nation.

In Outliers: The Story of Success, Gladwell described a difference between rice culture and wheat culture. The southern China is a rice culture and that hard working moral has permeated throughout China. The discipline and efficiency of achievement as demonstrated by the 2008 Olympics, for instance, reflects the collective will of the Chinese people.

Can China continue to develop her economy? Friedman did not think so. I think that is his first mistake. Yes, dynasties came and gone. But China has remained as a unity. As Kissinger, correctly observed, China is more a culture than a nation state. It will not fragment as Friedman suggested.

Chinese economy started at a very low level. Until her per capital income is in par with leading economy, her economic growth is easy. She does not need to make mistakes which are typical at the "cutting edge". When Chinese per capital income is in par with USA, her economy would be 4 times larger than USA - just by size of the population. Recent global financial crisis indicates that USA economic strength is not at powerful as Friedman would have wished.

With a powerful peace loving nation in place, the world would be safer. Unless some leaders in a country are insane, waging war against a nuclear nation is MAD. There has been no world war since the invention of nuclear weapons speaks volume to the danger of major conflict. USA's navy power could not be used to force her will onto China, nor be used to limit Chinese economic grow.

Just by the size of the population, China is producing more PhDs in Science and engineering than USA. A report in 2002 predicts that by 2010, China will have more PhD graduating than USA. [source: http://english.peopledaily.com.cn/200210/21/eng20021021_105393.shtml] The consistent relatively poor performance of USA students in all educational measures points to a weakening intellectual capacity of USA. The best students in USA choose to study the soft easy subjects such as commerce and law. The best students in China choose to study the hard sciences. The intellectual strength of China will only increase while the same cannot be said to USA. The limiting factor to Chinese growth is resources and energy. The lower living standard in China means Chinese manufacturing can afford to pay more for the scarce resources than USA. In a world where military might could not be used to steal other nations' resources, China will compete on economic terms with USA for energy and resources.

China is the largest foreign creditor of the USA government. Chinese strategic dumping of USA Treasury bonds into the market can influence the interest rate at which USA government can borrow money. If there is any leverage a government can put on another, it would be China having an upper hand than the USA.

21st century will not be an easy century. The climate change will have significant impact on relationships between nations. Friedman has completely ignored this factor in this book. The world has already warmed by 0.8 deg C and there is a 1.6 deg C locked in even if by a miracle every country on this planet wake up tomorrow morning and take the most serious steps to fight climate change - which is not likely to happen. There will be large population displacement and serious "natural" disasters due to the effect of extreme climate. Economic resources will be stretched.

The declining of fossil fuel will also significantly affect the economic development. China has put renewable energy source as her main strategic goal and determined to be the leading manufacturer of renewable energy. Independence of fossil fuel has been a national agenda since President Carter. The domestic politics of USA has been delaying any action in reducing USA's dependence on oil. That's not a sign of a power nation.

From history point, USA is young, very young. In the wild, death at young age is not uncommon. Being young does not imply powerful.

If USA policy is informed by Friedman, she will be in very dangerous water. USA needs to learn from UK how to survive in a world dominated by power other than USA.